(TheNewswire)
Vancouver, B C - TheNewswire- March 6, 2023 - Headwater Gold Inc. (CSE:HWG) (OTC:HWAUF) (the " Company " or" Headwater ") is pleased to announceacquisition of the Lodestar epithermal gold-silver project (the“Property”) located in the Aurora Mining District, Nevada UnitedStates (Figure 1).
Highlights:
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Headwater has acquired the Lodestar project in theAurora district through claim staking and an option to acquire a 100%interest in pre-existing claims from a private party.
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The Property is located immediately adjacenttojuxtaposes the past producing high-grade Aurora mine, owned by HeclaMining Company (“Hecla”).
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The Property represents a new 100% owned explorationopportunity located approximately 10 kilometres north of theCompany’s Spring Peak project, where it has recently made two newhigh-grade discoveries ( see news release datedMarch 2, 2023).
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Silica sinter exposures and other high-level epithermalalteration features on the Property are geologically analogous to theSpring Peak project and suggest the potential for preserved high-gradeepithermal veins at depth.
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Headwater plans to complete geologic mapping, soilsampling and CSAMT geophysical surveys concurrent with planned work atits Spring Peak project to define high-priority drill targets on theProperty.
Caleb Stroup, the President and CEO of the Company,states: “We are veryexcited to have acquired another high-quality asset in the AuroraDistrict, which is already a major focus area for Headwater. Sinceentering the district with our Spring Peak project acquisition 18months ago, we have demonstrated our ability to target high-grademineralization below shallow epithermal alteration, resulting inmultiple high-grade vein discoveries. We will be directly applyingwhat we have learned at Spring Peak to explore Lodestar, which isanalogous in many ways. Both projects contain large exposures ofsilica sinter, which, at Spring Peak, directly overlies the new DiscoZone discovery. Limited shallow historic drilling on both projectsencountered weakly anomalous gold but, importantly, was too shallow inthe epithermal system to adequately test for higher-grademineralization in the boiling zone at depth. At Spring Peak, theCompany has successfully utilized CSAMT geophysics to directly targetfeeder structures at depth and it is anticipated CSAMT will beutilized immediately at Lodestar, where much of the explorationpotential occurs under shallow post-mineral cover.”
Figure 1. Lodestar land position showingrelation to the Company’s Spring Peak project and Hecla MiningCompany’s adjoining past-producing Aurora minecomplex.
About the LodestarProject:
The Lodestar project is located in the Aurora MiningDistrict of west-central Nevada and adjoins Hecla’s past-producingAurora mine complex (Figure 1), where existing infrastructure includesa 350 ton per day mill, currently on care and maintenance, severalproduction water wells and high-voltage three-phase power. TheProperty is also located immediately north of the Company’s SpringPeak project, where Headwater has recently announced the new Disco andOpal Ridge high-grade discoveries (Figure 1, see news release datedMarch 2, 2023). These high-grade vein discoveries and Hecla’s 2022exploration drilling at Aurora (see Hecla news release dated November9, 2022), suggest good potential for additional high-grade discoveryexists at Lodestar.
Figure 2. Simplified geologic map of theLodestar project area showing area of strong silicification and sinterexposure as well as historic rock chip sample locations.
Historic exploration at the Property focused on surface rock chipsampling of the prominent silicified ridgeline at the core of theProperty (Figures 2,3, 4 & 5), sampling of a short historic adit(Figure 2) and several shallow Reverse Circulation (“RC”) holes inthis immediate area. RC drilling completed on the Property by EchoBay Exploration and Borealis Exploration in the 1980’s consisted offour shallow drill holes immediately adjacent to the silicifiedridgeline, designed to test for a near-surface bulk-tonnage typedeposit. Headwater has obtained assays but not exact collar andsurvey information for these historic holes, the deepest of whichreached a maximum total depth of 91.44 metres and contained a 10.67 minterval of 0.291 g/t Au. The Company views the anomalous goldobserved in the historic drilling, above the interpreted epithermalboiling zone to be a positive indication for precious metal bearingstructural feeders at depth, which remain untested.
Figure 3. Thick exposure of laminated sinterat the northern end of the prominent altered ridgeline in the centralLodestar land package (see Figures 1 and 2).
Figure 4. Left) Representative outcrop photoof finely laminated silica sinter with abundant palisade textures andpacked fragmental layers. Right) Silica sinter with radiating algalmounds interpreted to represent a near-vent environment.
The most prominent alteration feature on the Lodestar land packageis the strongly silicified and brecciated ridgeline capped by silicasinter, which is exposed as a window through young post-mineral lavaflows that form shallow cover across most of the claim block. Thenorthern part of the ridgeline contains a thick accumulation of silicasinter (Figure 3) that is similar in character to sinter exposed abovethe Disco Zone at the Company’s Spring Peak project (see newsrelease dated March 2, 2023). Silica sinter at Lodestar is oftenlaminated with low-amplitude algal mats containing reed casts andpalisade textures and locally contains interpreted geyserite textures(Figure 3). These diagnostic sinter textures and the thickness ofsinter accumulation imply a prolonged period of energetic hydrothermalactivity localized in the project area.
Figure 5. Strongly silicified hydrothermalbreccia exposed immediately south of the main sinter outcrop.
Immediately south of the sinter, the silicified ridgeline is aresistant silicified breccia body which is steeply inclined to thewest (Figures 2 and 5). This breccia contains large, angular,rotated clasts of silicified rhyolite as well as opaline andchalcedonic silica veins and vein fragments imply a high-energyhydrothermal origin of brecciation. In most places, the breccia isstrongly silicified and oxidized and both the breccia body andoverlying sinter are cut by abundant cross-cutting banded chalcedonicveins. Headwater geologists interpret these features to represent ahydrothermal vent breccia exposed along a steep west-dippingstructural zone that disappears under shallow, young volcanic cover tothe north and south (Figures 2 and 6) and remains untested below theprojected boiling zone at depth.
Figure 6. Schematic cross-section showinghistoric adit channel samples and conceptual vein targets beneathhigh-level epithermal alteration and sinter exposed at the surface.
Historic rock chip samples along the exposed extent of thesilicified ridgeline contained anomalous gold, silver, and epithermalpathfinder element values (Figure 2). A historic rock chip sample of silicified breccia collectedalong the southern portion of the ridgeline returned 261 ppb Au and430 ppb Ag (Figure 2), and another grab sample of breccia withcross-cutting banded chalcedonic veins returned 150 ppb Au and 530 ppbAg. C hannel samples collected in a historicadit into the southern portion of the ridgeline encountered increasinggold values toward the interpreted feeder structure, where thesampling ended in values between 50 ppb Au and 100 ppb Au.
The thick exposure of silica-sinter and silicifiedbreccia with highly anomalous Hg-As-Mo-Sb epithermal pathfinderelement geochemistry, both cut by banded chalcedonic veins, suggestthe core of the Lodestar property is comprised of the upper-levels ofa fully preserved epithermal system. The alteration style andintensity, sinter characteristics and existing rock geochemistry ofthe system all share numerous encouraging similarities with theCompany’s adjacent Spring Peak project. Historic RC drilling onthe Property was also completed in a similar fashion to theCompany’s Spring Peak project; shallow holes failed to test forpotential high-grade mineralization at depth. Based on analogouscharacteristics to the Company’s Disco Zone target area at SpringPeak, Headwater geologists have defined a clear target areaapproximately 150 m below the sinter exposure, which would immediatelytest potential high-grade veins associated with the interpreted feederstructure (Figure 6).
2023 WorkPlan:
The exploration model that the Company intends todeploy at Lodestar is similar to that used at the Company’s nearbySpring Peak project. A combination of geology, geochemistry andgeophysics will be utilized to develop the highest-priority targets totest for high-grade epithermal vein mineralization in structuralfeeder zones below and adjacent to the outcropping alteration.
The Company is planning a controlled-sourceaudio-frequency magnetotelluric (“CSAMT”) resistivity surveytotaling 13.5 line-kilometres (“line-km”) on 250 metre (“m”)spaced profiles to identify high-resistivity targets at depth andexplore beneath the exposed alteration as well as the shallow, youngvolcanic cover that blankets most of the Property. Concurrently, theCompany intends to complete a soil sampling program consisting ofapproximately 325 soil samples collected along a 25 m x 100 m spacedgrid. Detailed geologic mapping and infill rock chip samplingfocused on the core area of exposed alteration will also be completedwith the aid of high-resolution drone imagery and a digital surfacemodel. The results of this preliminary work will be used to design amaiden drill campaign at the Property.
AcquisitionTerms:
The Lodestar project consists of 121 unpatented miningclaims staked by Headwater Gold and 12 unpatented mining claimsacquired from a private prospector (the “Vendor Claims”). Bymaking an initial cash payment of US$20,000 and escalating annualpayments, Headwater retains a 30-year option to purchase an undivided100% interest in the Vendor Claims for a one time payment ofUS$1,500,000 subject to a 3% NSR royalty, of which an initial 1% canper purchased at any time for US$1,000,000 and an additional 1% forUS$2,000,000 resulting in a post-buydown 1% NSR.
About Headwater Gold:
Headwater Gold Inc. (CSE: HWG, OTCQB: HWAUF) is atechnically-driven mineral exploration company focused on theexploration and discovery of high-grade precious metal deposits in theWestern USA. Headwater is aggressively exploring one of the mostwell-endowed and mining-friendly jurisdictions in the world with agoal of making world-class precious metal discoveries. Headwater hasa large portfolio of epithermal vein exploration projects and atechnical team comprised of experienced geologists with diversecapital markets, junior company and major mining company experience. The Company is systematically drill testing several projects inNevada, Idaho, and Oregon and in August 2022 announced a significanttransaction with Newcrest Mining Limited where Newcrest acquired a9.9% strategic equity interest in the Company and entered into earn-inagreements on four of Headwater’s projects.
For more information, please visit the Company'swebsite at www.headwatergold.com .
On Behalf of the Board ofDirectors
Caleb Stroup
President and CEO
+1 (775) 409-3197
For further information, please contact:
Brennan Zerb
Investor Relations Manager
+1 (778) 867-5016
Qualified Person:
The technical information contained in this newsrelease has been reviewed and approved by Scott Close, P.Geo (158157),a “Qualified Person” (“QP”) as defined in National Instrument43-101 – Standards of Disclosure for Mineral Projects.
Forward-Looking Statements:
This news release includes certainforward-looking statements and forward-looking information(collectively, “forward-looking statements”) within the meaning ofapplicable Canadian securities legislation. All statements, other thanstatements of historical fact, included herein including, withoutlimitation, statements regarding future capital expenditures,exploration activities and the specifications, targets, results,analyses, interpretations, benefits, costs and timing of them,Newcrest’s anticipated funding of the earn-in projects and thetiming thereof, and the anticipated business plans and timing offuture activities of the Company, are forward-looking statements.Although the Company believes that such statements are reasonable, itcan give no assurance that such expectations will prove to be correct.Often, but not always, forward looking information can be identifiedby words such as “pro forma”, “plans”, “expects”,“may”, “should”, “budget”, “scheduled”,“estimates”, “forecasts”, “intends”, “anticipates”,“believes”, “potential” or variations of such words includingnegative variations thereof, and phrases that refer to certainactions, events or results that may, could, would, might or will occuror be taken or achieved. Forward-looking statements involve known andunknown risks, uncertainties and other factors which may cause theactual results, performance or achievements of the Company to differmaterially from any future results, performance or achievementsexpressed or implied by the forward-looking statements. Such risks andother factors include, among others, risks related to the anticipatedbusiness plans and timing of future activities of the Company,including the Company’s exploration plans and the proposedexpenditures for exploration work thereon, the ability of the Companyto obtain sufficient financing to fund its business activities andplans, the risk that Newcrest will not elect to obtain any additionalinterest in the earn-in projects in excess of the minimum commitment,the ability of the Company to obtain the required permits, changes inlaws, regulations and policies affecting mining operations, theCompany’s limited operating history, currency fluctuations, titledisputes or claims, environmental issues and liabilities, as well asthose factors discussed under the heading “Risk Factors” in theCompany’s prospectus dated May 26, 2021 and other filings of theCompany with the Canadian Securities Authorities, copies of which canbe found under the Company’s profile on the SEDAR website atwww.sedar.com.
Readers are cautioned not to placeundue reliance on forward-looking statements. The Company undertakesno obligation to update any of the forward-looking statements, exceptas otherwise required by law.
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